Module 1 Introduction to Consumer Behaviour

1.Meaning and nature of Consumer behaviouor.

Definition : According to Engel, Blackwell, and Mansard, ‘consumer behaviour is the actions
and decision processes of people who purchase goods and services for personal consumption’.

Meaning: The Consumer Behavior is the study of how an individual decides to purchase a
particular product over the other and what are the underlying factors that mold such behavior.

➢ Nature of consumer behavior.

1.Process : Consumer behaviour is a systematic process relating to buying decisions of the

customers. The buying process consists of the following steps;
1. Need identification to buy the product .
2. Information search relating to the product.
3. Listing of alternative brands.
4. Evaluating the alternative (cost-benefit analysis)
5. Purchase decision.
6. Post-purchase evaluation by the marketer.

2. Influenced by various factors : Consumer behaviour is influenced by a number of factors. The

factors that influence consumers are : marketing, personal, psychological, situational, social,
cultural etc
.
3. Different for all customers : All consumers do not behave in the same manner. Different
consumers behave differently. The difference in consumer behaviour is due to individual factors
such as nature of the consumer’s life style, culture, etc.

4. Different for different products :

Consumer behaviour is different for different products. There are some consumers who may buy
more quantity of certain items and very low/no quantity of some other items.

5. Region bounded : The consumer behaviour varies across states, regions and countries. For
instance, the behaviour of urban consumers is different from that of rural consumers.
Normally, rural consumers are conservative (traditional) in their buying behaviour

6. Vital for marketers : Marketers need to have a good knowledge of consumer behaviour. They
need to study the various factors that influence consumer behaviour of their target customers. The
knowledge of consumer behaviour enables marketers to take appropriate marketing decisions.
 7. Reflects status : Consumers buying behaviour is not only influenced by status of a consumer,
but it also reflects it. Those consumers who own luxury cars, watches and other items are
considered by others as persons of higher status.

8. Spread - effect : Consumer behavior has a spread effect.

The buying behaviour of one person may influence the buying behavior of another person. For
instance, a customer may always prefer to buy premium brands of clothing, watches and other
items etc. This may influence some of his friends, neighbours, colleagues. This is one of the
reasons why marketers use celebrities to endorse their brands.

9. Standard of living : Consumer buying behaviour may lead to higher standard of living. The
more a person buys the goods and services, the higher is the standard of living

.
10. Keeps on changing : The consumer’s behaviour undergoes a change over a period of time
depending upon changes in age, education and income level. Etc, for instance,, kids may prefer
colorful dresses, but as they grow up as teenagers and young adults, they may prefer trendy clothes.

2: Significance of Consumer behavior.

1. Goal Achievement: The key to the company’s survival, profitability, and growth in a highly
competitive marketing environment is its ability to identify and satisfy consumers unfulfilled needs
better and sooner than the competitors. Thus, consumer behaviour helps in achieving marketing
goals.

2. Development of Marketing Programme: Marketing programme consists of product, price,

promotion, and distribution decisions. The programme can be more relevant if it is based on the
study of consumer behaviour.

3. Predicting Market Trend: Consumer behaviour can also help in forecasting the future trends.
Due to this, the marketer can prepare its strategies well in advance in order to take advantage of
the emerging opportunities, and/or for facing challenges and threats.

4. Consumer Differentiation: Each segment needs different products and a separate marketing
programme. Having knowledge of consumer differentiation is an important key to formulate
different offers which are appealing to different groups of buyers. Consumer behaviour study
provides details about consumer differentiations.

5. Creation and Retention of Consumers: Marketers who base their offering after recognising
consumer needs often find a ready market for their products and finds it easy to sell its products.
Thus due to continuous study of consumer behaviour and attempts to meet ever-changing
expectations of the buyers, the marketer can retain its consumers for longer period.

6. Competition: Consumer behaviour study helps the marketer to gain competitive advantage
since through the study the marketer can offer more competitive products, based on consumers’
expectations. Thus it helps in improving competitive strengths of the company.

7. New Product Development: New product is developed in order to satisfy the needs and wants
of the target market. In order to develop the best-fit product, marketer must have enough
knowledge about the market. Thus, the study of consumer behaviour is the basis for developing a
new product successfully.

8. To design production policies-The production policies have to be designed taking into

consideration the consumer preference so that product can be successful in the market.
In every business, the main motive is to enhance the production and as well as sales of the company
and to do all these, any company or business has to win the trust of its customers and studying
about their tastes, likings, and preferences.

9. Implement STP Strategies-The segmentation, targeting, and positioning strategies are

implemented by understanding the behaviour of consumers towards the various brands.
The products are targeted grouping the customers having common taste and preference and finally
positioned in the market. Thus, building a positive image of the product of a company related to
the competitors and as well as help to beat them also.

3: Factors influencing consumer behavior

1. Psychological Factors: The human psychology plays a crucial role in designing the
consumer’s preferences and likes or dislikes for a particular product and services. Some of the
important psychological factors are:

▪ Motivation: The level of motivation influences the buying behavior of the consumers. It is
very well explained by Maslow through his need hierarchy theory comprising of basic needs,
security needs, social needs, esteem needs and self-actualization needs. Usually, the basic
needs and the security needs are more pressing needs than the other and hence, these needs
become a motive that directs the consumer behavior to seek satisfaction.
▪ Perception: The consumer perception towards a particular product and the brand also
influences his buying decision. The perception is the process through which the individual
selects, organize and interpret the information to draw a meaningful conclusion. Such as,
 Apple iPhone is perceived as a premium brand and consumers are motivated to buy it to get
associated with the elite class of the society.
▪ Learning: The individual’s learning depends on the skills, knowledge and intention. The skills
are developed through practice while the knowledge and intention are acquired with the
experience. There could be a conditional learning or a cognitive learning.
▪ Attitudes and Beliefs: The individuals have certain beliefs and attitudes towards products on
which their purchase decisions rests. These attitudes and beliefs are the tendency to respond
to a given product in a particular way, and these make up the brand image that influences the
consumer buying behavior.
2.Social Factors: The human beings live in a complex social environment wherein they are
surrounded by several people who have different buying behaviors. Since the man is a social
animal who likes to be acceptable by all tries to imitate the behaviors that are socially
acceptable. Hence, the social factors influence the buying behavior of an individual to a great
extent. Some of the social factors are:

▪ Family: The family members play a crucial role in designing one’s preferences and
behavior. It offers an environment wherein the individual evolves, develop personality and
acquire values. The family can influence the buying behavior of an individual in either of the
two ways:
• Influences the personality, attitude, beliefs, characteristics of the individual.
• Influences the decision making of an individual with respect to the purchase of certain
goods and services.
▪ Reference Groups: A reference group is a group with which an individual likes to get
associated. It is observed, that all the members of the reference group share common buying
behavior and have a strong influence over each other.The marketers should try to identify the
roles within the reference group that influences the behavior of others. Such as Initiator,
influencer, Decision-Maker and Buyer

▪ Roles and status: An individual’s position and role in the society also influences his buying
behavior. Such as, a person holding a supreme position in the organization is expected to
purchase those items that advocate his status. The marketers should try to understand the
individual’s position and the role very much before the endorsement of the products.
3.Cultural Factors: It is believed that an individual learns the set of values, perceptions,
behaviors, and preferences at a very early stage of his childhood from the people especially, the
family and the other key institutions which were around during his developmental stage. Thus,
the behavioral patterns are developed from the culture where he or she is brought up. Several
cultural factors are:
▪ Culture: The culture refers to the beliefs, customs, rituals and practice that a particular group
of people follows. The culture varies from region to region and even from country to country
Therefore, the marketer should carefully study all the different cultures and frame the
marketing strategies accordingly.

▪ Subculture: The culture can be further divided into subculture wherein the people are
classified more specifically on the basis of their shared customs and beliefs, including
religions, geographic regions, nationalities, etc. The different sub-cultures forms several
market segments whose needs can be carefully studied by the marketer, and the strategic
marketing decisions can be taken accordingly.

▪ Social Class: The social class to which an individual belongs influences the buying decision.
Generally, the people belonging to the same class are said to be sharing the similar interest,
value and the behavior. Our society is classified into three social classes upper class, middle
class, and the lower class. The consumers belonging to these classes possess different buying
behaviors.

4.Personal Factors: There are several factors personal to the individuals that influence their
buying decisions. Some of them are:

▪ Age: The consumer buying behavior is greatly influenced by his age, i.e. the life cycle stage
in which he falls. The people buy different products in different stages of the life cycle. Such
as the purchase of confectionaries, chocolates is more when an individual is a child and as he
grows his preferences for the products also changes.
▪ Income: The income of the person influences his buying patterns. The income decides the
purchasing power of an individual and thus, the more the personal income, the more will be
the expenditure on other items and vice-versa.
▪ Occupation: The occupation of the individual also influences his buying behavior. The
people tend to buy those products and services that advocate their profession and role in the
society
▪ Lifestyle: The consumer buying behavior is influenced by his lifestyle. The lifestyle means
individual’s interest, values, opinions and activities that reflect the manner in which he lives
in the society. Such as, if the person has a healthy lifestyle then he will avoid the junk food
and consume more of organic products.

5.Economic Factors: The last but not the least is the economic factors which have a significant
influence on the buying decision of an individual. These are:

▪ Personal Income: The personal income of an individual influences his buying behavior as it
determines the level to which the amount is spent on the purchase of goods and services
▪ Family Income: The family income refers to the aggregate of the sum of the income of all the
family members. The total family income also influences the buying behaviors of its
members. The income remaining after meeting all the basic necessities of life can be used for
the purchase of shopping goods, luxury items, durable goods, etc.
▪ Income Expectations: An Individual’s expectation with respect to his income level in the
future influences his buying behavior today. Such as, if a person expects his income to
increase in the future, then he will spend more money on the purchase of the luxury goods,
durables and shopping goods
▪ Consumer Credit: The credit facility available to the consumer also influences his buying
behavior. If the credit terms are liberal, and EMI scheme is also available, then the customers
are likely to spend more on the luxury items, durable goods, and shopping goods.
▪ Savings: The amount of savings out of the personal income also influences the consumer
buying behavior. Such as, if the customer decides to save more for a particular period, then
his expenditure on the other items will be less and in case the savings are less the expenditure
on other items increases.

4.Consumer Decision Making Process

1:Problem or Need Recognition: Consumer decision making process begins with an unsatisfied
need or problem. Everyday we face multiple problems which individuals resolve by consuming
products or services. Consumer problem can be routine or unplanned. For example – run out of
milk or cooking oil, car indicating low level of fuel, are some of the routine problems that
individuals face. Such problems are quickly recognised, defined, and resolved. Recognition of
unplanned problem may take much longer time as it may evolve slowly over time. For example -
need of a new refrigerator as existing one is not working properly.

2:Information Search :Information search is done to know about product or service, price,
place and so on. In the process of decision making, the consumer engages in both internal and
external information search. Internal information search involves the buyer identifying
alternatives from his memory. Internal information search is sufficient for low involvement
products or services. For high involvement product or service, buyers are more likely to do
external information search. The amount of efforts a buyer put in information search depends on
various factors like market, competition, difference in brands, product characteristics, product
importance, and so on.

3:Alternatives Evaluation :At this step the buyer identifies and evaluates different alternatives
to choose from. It is not possible to examine all the available alternatives. So, buyer develops
evaluative criteria to narrow down the choices. Evaluative criteria are certain characteristics that
are important to buyer such as price of the product, size, colour, features, durability, etc. Some of
these characteristics are more important than others. To narrow down the choices the buyer
considers only the most important characteristics.

4:Purchase Decision :The earlier mentioned evaluation step helps the consumer in arriving at a
purchase intention. In the decision evaluation stage, the consumer forms preferences among the
brands in the choice set. The consumer may also form a purchase intention and lean towards
buying the most preferred brand. However factors can intervene between the purchase intention
and the purchase decision. A buyer who decides to execute a purchase intention will be making
up to five purchase decisions brand decision, vendor decision, quantity decision, timing decision
and payment method decision.

5:Post-purchase Use and Evaluation : Once the buyer makes a decision to purchase a product
or service there can be several types of additional behaviour associated with that decision such as
decisions on product uses and decision on services related to the product purchased. The level of
satisfaction experienced by the buyer after his purchase will depend on the relationship between
his expectations about the product and performance of the product. If the buyer is satisfied then
he will exhibit a higher probability of repeat purchase of the product or service. The satisfied
buyer will also tend to say good words about the product or service. Whereas a highly
dissatisfied buyer will not buy the product or service again and spread negative words about
service and company.
5: Buyer roles.

1.Initiators: First identifies the need to buy a particular product or service to solve an
organisational problem. They are usually the ones who request that something be purchased. They
may be users or others in the organization. For example- for office equipment's , the initiative may
be taken by administrative department • Users – Those who will use the product or services .In
many cases the users initiate the buying proposal and help define the product requirements.

2.Influencers: Those family members who provide information and advice and thus influence the
purchase Their views influence the buying centre’s buyers and deciders..The wife tells her family
about the new eatery that has opened in the neighborhood and her favorable description about it
influences her husband and teenaged children..

3. Deciders: Family members who have the power to unilaterally or jointly decide whether or not to
buy a product or service. The husband and wife may jointly decide about the purchase of a new
refrigerator

4.Approvers: People who authorize the proposed actions of deciders or buyers are approvers.
They could also be personnel from top management or finance department or the users in case of
organization . In case of family, it could be either of the parent or any elder member.

5. Buyers: : Those family members who actually buy a particular product or service. A
housewife may be the person who actually buys all the foodstuffs, rations, which are consumed
by all the family members.. In case of organizations, purchase department Holds the formal
authority to select the supplier and to arrange terms of condition.

6. Users: : Those family members who use or consume a particular product or service. All family
members may use the car, watch the television, and listen to the stereo music system

7.Gate Keepers: Those family members who control the flow of information about a
product/service thus influencing the decisions of other family members. The teenage son, who
wants a racing bicycle, may withhold from his father much of the relevant information on all
brands except the one that he fancies, thereby influencing his father’s decision in favour of his
preferred brand.

6: Levels of consumer decision making

1) Extensive decision making process –This type of decision making process is used when the
product is a very high involvement product, possible a high investment product as well. Typical
examples include buying a house for a consumer, or buying a new manufacturing plant in case of
industries. In both cases, there are multiple people involved, and the decision making is extensive
as the customer wants to get maximum benefits. There are also risks involved in such endeavours,
hence extensive decision making is done.

2) Limited decision-making process –Buying a television or buying a car will be a limited

decision making process. When you are buying such white goods, the investment is nominal and
not very high. At the same time, you have some experience with the product as you regularly watch
television and you regularly sit in cars.Thus, you do not spend as much time on buying these
products. Nowaday, the limited decision making process is further helped with the presence of
online media, where people know a lot about the product while sitting at home itself. The speed of
the limited decision making is dependent on the customer experience and his knowledge about the
product as well as the amount of time he has to make the decision.

3) Routine decision making process –Routine decision making happens in day to day life like
buying a soap or shampoo. In this case, the customer is more likely to stick to a single brand for a
long time. He is unlikely to switch to different brands because he wants to invest minimum time
in routine decision making. There are a lot of things which influence the routine decision making
process, like regular advertising by FMCG companies. This is because, the routine things are
brought over and over again. And once the company gets such a customer, they are likely to reap
long term profits from the same customer.

Module 2 Psychological Influences on Consumer Behaviour

1. Personality Theories & Behaviour of Consumer – An overview

The personality implies psychological and social character that an individual acquires by
hereditary biological endowment which provides him the basis for development and social
growth of environment within which he springs forth.

Characteristics of Personality:

1. Personality is something which is unique in each individual: Personality refers to internal

as well as external qualities, some of which are quite general. But it is unique to each individual.
It is not possible for any other individual to reproduce or imitate the qualities of the personality
of the individual.
2. Personality refers particularly to persistent qualities of an individual: Every individual
has certain feeling as well as other permanent traits and qualities. Personality is mainly
composed of the persistent or permanent qualities that exhibit themselves in form of social
behaviour and attempt to make adjustment with the environment

3. Personality represents a dynamic orientation of organism to environment: Personality

represents the process of learning. It takes place in reference to the environment. We do not
acquire all the traits of personality all at once.

4. Personality is greatly influenced by social interactions:

Personality is not an individual quality. It is a result of social- interaction. In other words, it
means that when we come in contact with other members of the society, we acquire certain
qualities while we exhibit certain others. All these come to form personality.

5. Personality represents a unique organisation of persistent dynamic and social

predisposition: In personality various qualities are not put together. They are, in fact, integrated
into one. This integration is nothing but a result of organisation which may be different from
man to man. The behaviour of a person directed to one particular individual may differ from the
behaviour of another person.

6.Consistency:There is generally a recognizable order and regularity to behaviors. Essentially,

people act in the same ways or similar ways in a variety of situations.

7. Personality has Multiple expressions :Personality is displayed in more than just behavior. It
can also be seen in our thoughts, feelings, close relationships, and other social interactions.
Actually, personality is the unique combination of patterns that influence behavior, thought,
motivation, and emotion in a human being.

➢ Personality Theories

1.Freud’s Theory:This theory was given by Sigmund Freud. Freud’s psychoanalytical theory
stresses the unconscious nature of personality as a result of childhood conflicts. According to this
theory, the human personality system consists of the id, ego, and superego and conflicts are
derived from these three components.

• id: The id is the source of psychic energy and seeks immediate gratification for biological
and instinctual needs .In other words, id is conceptualized as a warehouse of primitive and
 impulsive drives for which individual seeks immediate satisfaction without concern for the
specific means of satisfaction. The id operates on one principle, directing behaviour to
achieve pleasure and to avoid pain. The id is entirely unconscious with no objective reality.

• Superego: Superego is the individual’s internal expression of society’s moral and ethical
codes of conduct. This means superego is the leash on the id and works against its impulses.
It does not manage the id but restrains it by punishing unacceptable behaviour through the
creation of guilt. It’s role is to see that individual satisfies needs in a socially acceptable
fashion. So, superego is a kind of ‘brake’ that inhibits the impulsive forces of the id.

• Ego: The ego is the individual’s self-concept and is the manifestation of objective reality as
it develops after interaction with the external world. Ego is the individuals conscious control
and it functions as an internal monitor that attempts to balance the impulsive demands of the
id and the socio-cultural constraints of the super ego.According to this theory, ego manages
the conflicting demands of the id and superego. When the child manages these conflicts then
this determinies the adult personality. But if conflicts are not resolved in childhood then this
will result in defence mechanisms and will influence later behaviour. Defence mechanisms
are the strategies that the ego uses to reduce tensions.

2.Socio – Psychological Theory: According to this theory, the individual and society are
interlinked. This theory disagrees with Freud’s contention that personality is primarily instinctual
and sexual in nature. It is also known as the Neo – Freudian Personality Theory, researchers
believe that social relationships are fundamental to the formation and development of
personality.

• Alfred Adler was the foremost proponent of this social orientation. He emphasized that
individual’s strive for superiority in a social context. This he called as style of life. He
also emphasized on the individual’s efforts to overcome feelings of inferiority (i.e., they
strive for superiority)

• Harry Stack Sullivan, stressed that people continuously attempt to establish significant
and rewarding relationships with others. He was more interested with the individual’s
efforts to reduce tensions such as anxiety.

• Karen Horney was another social theorist. She believed that personality is developed as
an individual learns to cope with basic anxieties that stems up from parent – child
relationships.

She proposed that individuals can be classified into three personality groups:
 (a) Compliant:Those individuals who move toward others. They desire to be loved, wanted and
appreciated.
(b) Aggressive:Those individuals who move against others. They desire to excel and win
admiration.
(c) Detached: Those individuals who move away from others. They desire independence, self –
sufficiency and freedom from obligations.

2. Modern Trends in Lifestyles of Consumer

• Beyond Human: Artificial intelligence is becoming mainstream. Consumers are embracing AI

for convenience, and businesses are integrating this technology to automate operations and
deliver personalized solutions.

• Catch Me in Seconds: With the amount of information readily available, capturing consumer
attention requires concise, relevant and multisensory content that can be processed in an instant.

• Frictionless Mobility: Consumers want modular and personalized transportation options that
account for time, budget, weather and occasion for a seamless travel journey.

• Inclusive for All: Brands are reframing their products and services to be accessible to
everyone. Diversity will become a measure of brand relevance.

• Minding Myself: Prioritizing mental health and searching for products positioned to address
specific well-being needs.

• Multifunctional Homes: The ability to do everything—work, shop, exercise and other

activities—from the comfort of home is shifting consumer habits to revolve around in-home
consumption.

• Private Personalization: Consumers want tailored experiences but are concerned about the
collection and sharing of personal data. Consumers will likely opt out of digitally manufactured
experiences that do not add value

• Proudly Local, Going Global:Consumers are returning to their roots. Niche brands start their
global route to success by accentuating their local credentials. Multinationals are becoming
more sophisticated in shaping their products to local culture.
• Reuse Revolutionaries: Ethical consumers are looking for alternatives to single-use products
to reduce environmental footprint and waste. New circular business models aim to offer more
with less through sharing, reusing, refilling and renting.

• We Want Clean Air Everywhere: The impact of air pollution on health is becoming widely
known with climate activism only escalating. Businesses are facing pressures to provide
solutions that safeguard the environment and consumers from the effects of poor air quality.
The future points toward cleaner and more sustainable cities.

3. Role of Motivation in Consumer Behaviour –

Motivation is the driving force within individuals that impels them to action. Motivation is the
activation or energization of goal-oriented behavior. Motivation may be intrinsic or extrinsic.

• Needs :Every individual has needs, they are innate and acquired. Innate needs are also called
physiological needs or primary needs which include food, water, air, shelter or sex, etc.
Acquired needs are those needs that we learn from our surroundings / environment or culture.
These may include need for power, for affection, for prestige, etc. These are psychological in
nature; therefore they are also called as secondary needs.

• Goals:Goals are the end result of motivated behaviour. As in the above diagram (3.2) every
individual’s behaviour is goal-oriented.
From marketer point of view, there are four types of goals:
(a) Generic goals:General classes of goals that consumers select to fulfill their needs. For
example, need for washing hands.
(b) Product specific goals: For washing hands what kind of product is used. For example, use
soap, liquids etc.

(c) Brand specific goals:For example, which soap – Lux, Pears etc., to be purchased.

(d) Store specific goals:From where that product must be purchased

• Motives:Consumer researchers have given two types of motives-rational motives and

irrational (emotional) motives. They say, that consumers behave rationally when they
consider all alternatives and choose those that give them the greatest utility. This is also
known as economic man theory.Marketers meaning of rationality is when consumers select
goals based on totally objective criteria such as size, weight or price, etc. Emotional motives
imply the selection of goals according to personal or subjective criteria. For example, desire
for status, individuality, fear of owning the product (from society), pride, affection, etc.
4. Beliefs & Attitudes and its impact on Consumer Behaviour

Consumer attitude may be defined as a feeling of favorableness or unfavorableness that an

individual has towards an object. As we, all know that an individual with a positive attitude is
more likely to buy a product and this results in the possibility of liking or disliking a product.
Consumer attitude basically comprises of beliefs towards, feelings towards and behavioral
intentions towards some objects.
Belief plays a vital role for consumers because, it can be either positive or negative towards an
object. For example, some may say tea is good and relieves tension, others may say too much of
tea is not good for health. Human beliefs are not accurate and can change according to situations.
Consumers have certain specific feelings towards some products or brands. Sometimes these
feelings are based on certain beliefs and sometimes they are not. For example, an individual feels
uneasy when he thinks about cheese burst pizza, because of the tremendous amount of cheese or
fat it has.
Behavioral intentions show the plans of consumers with respect to the products. This is
sometimes a logical result of beliefs or feelings, but not always. For example, an individual
personally might not like a restaurant, but may visit it because it is the hangout place for his
friends.

➢ Functions of Attitudes

The following are the functions of attitudes

• Adjustment Function − Attitudes helps people to adjust to different situations and
circumstances.
• Ego Defensive Function − Attitudes are formed to protect the ego. We all are bothered
about our self-esteem and image so the product boosting our ego is the target of such a
kind of attitude.
• Value Expression Function − Attitudes usually represent the values the individual
posses. We gain values, though our upbringing and training. Our value system encourages
or discourages us to buy certain products. For example, our value system allows or
disallows us to purchase products such as cigarettes, alcohol, drugs, etc.
• Knowledge Function − Individuals’ continuously seeks knowledge and information.
When an individual gets information about a particular product, he creates and modifies
his attitude towards that product.

➢ Models of Attitude
The following are the models of attitude
• Tri-component Model − According to tri-component model, attitude consists of the
following three components.
• Cognitive Component − The first component is cognitive component. It consists of an
individual’s knowledge or perception towards few products or services through personal
experience or related information from various sources. This knowledge, usually results
in beliefs, which a consumer has, and specific behavior.
• Affective Component − The second part is the affective component. This consists of a
person’s feelings, sentiments, and emotions for a particular brand or product. They treat
them as the primary criteria for the purpose of evaluation. The state of mind also plays a
major role, like the sadness, happiness, anger, or stress, which also affects the attitude of
a consumer.
• Conative Component − The last component is conative component, which consists of a
person’s intention or likelihood towards a particular product. It usually means the actual
behavior of the person or his intention.

Module 3 Sociological Influences on Consumer Behaviour

1. Culture & its impact on Consumer Behaviour

Culture influences consumers through the norms and values established by the society in which
they live. It is the broadest environmental factor that influences you as consumer. Cultural values
are enduring and any attempts to change them generally fail. The study of culture is concerned
with a comprehensive examination of factors such as language, religion, knowledge, laws, art,
music, work patterns, social customs, festivals and food etc. of a society. In fact, culture includes
everything that reflects its personality.

➢ Culture has following features:

1. Culture is invented: It cannot be viewed as something that just "exists" and waiting to be
discovered. People are responsible for inventing their culture and this invention consists of three
interdependent components:
(a) Ideological component refers to ideas, beliefs, values and approaches to defining what is right
and wrong, or desirable and undesirable.
(b) Technological component is concerned with the skills, arts and crafts that provide humans
with the means to produce goods by using what is available to them in their environment.
(c) Organisational component enables humans to live in the family system and makes it possible
to coordinate their behaviour effectively with others' actions.

2. Culture is learned: It is not like biological features or instinctive. The process of learning
cultural values begins early in life largely through social interactions among families, friends, in
settings such as educational and religious institutions.

3. Culture is shared by a fairly large group of human beings living in organised societies and
works as a linking force. Generally, common religion and language are the critical elements that
largely help people share values, customs, norms and experiences.

4. Culture satisfies needs: Its components are passed down through generations because they
are gratifying. Culture offers order, direction and guides societies in all phases of life by
providing tried and trusted ways of meeting the physiological, personal and social needs and due
to these reasons people feel comfortable in doing things in the customary way.

5. Cultures are similar but different: There are certain similarities among all cultures and
many elements are present in all societies such as athletic sports, adornment of body, cooking of
food, a calendar, family, government, language, religious rituals, language, dancing, music and
many others elements. There are, though, very significant variations in the nature of these
elements in different societies and may exhibit important differences in consumer behaviour.

6. Culture is not static: Some cultures are relatively more resistant to change than others but
they do change gradually and continuously. These changes, however, may be very slow in some
cultures while others may be more dynamic and receptive to changes.

Cultural factors affecting consumer behavior

1.Culture: Culture is the most fundamental determinant of a person’s want and behaviour. The
growing child acquires a set of values, perception preferences and behaviours through his or her
family and other key institutions. Culture influences considerably the pattern of consumption and
the pattern of decision-making. Marketers have to explore the cultural forces and have to frame
marketing strategies for each category of culture separately to push up the sales of their products
or services. But culture is not permanent and changes gradually and such changes are
progressively assimilated within society.Culture is a set of beliefs and values that are shared by
most people within a group

b) Sub-Culture:Each culture consists of smaller sub-cultures that provide more specific

identification and socialisation for their members. Sub-culture refers to a set of beliefs shared by
a subgroup of the main culture, which include nationalities, religions, racial groups and
geographic regions. Many sub-Cultures make up important market segments and marketers have
to design products and marketing programs tailored to their needs.Although this subgroup will
share most of the beliefs of the main culture, they share among themselves another set of beliefs,
which may be at odds with those held by the main group

c) Social class: Consumer behaviour is determined by the social class to which they belong.
Social class is relatively a permanent and ordered division in a society whose members share
similar value, interest and behaviour. Social class is not determined by a single factor, such as
income but it is measured as a combination of various factors, such as income, occupation,
education, authority, power, property, ownership, life styles, consumption, pattern etc.
There are three different social classes in our society. They are upper class, middle class and
lower class.

2. Promotion and communication by marketers based on culture in India- Case Studies.

Due to the era of globalization where the economies are expanding and integrating with the other
economies and are exposed to universal marketing mix, there is a need to understand the fact that
promotion of a product is highly affected by the cultural patterns of different countries.

So why culture is so important when it comes to branding? Culture provides a wireframe of an

individual behavior. It plays a major role in influencing people and captivating them to pursue to
follow a particular brand. Hence, it is indispensable for the organizations to instill the cultural
blend of the specific region, in order to continue their momentum to get hold of the target end
users. When a brand is introduced in the market, it is very important that it analyses the taste and
the flavors of the particular region in order to adapt the same in their product. In India, there is a
diversified environment, where every region and area has its own set of colors. Since, this is the
very basis of the identity or origin of an individual, and is deep rooted in the lifestyle of people
which is very evident in the food habits, the fashion, morals or beliefs hence it gets crucial in
terms of sentimental values. It is therefore imperative for an organization to mold themselves
with the influence of the place in order to strengthen their underlying base on which they want to
build the pyramid of the brand.

Most of the organization follows the tried and tested method while expanding themselves beyond
their home region. However, a presumption of selling the brand just by the pedigree or genuinity
is not enough. An organization should make an attempt to understand the target audience,
analyze the needs, consider the feedbacks and shortcomings in the available products to set its
foot right and minimize the risks. The cultural blending hence comes as a mitigation pointer as it
deals with the ethnicity and ethicality of people residing there. The biggest example is the
evolution of Indian market in terms globalization. Many international brands attuned themselves
to the cultural blends to firm their grip in the era of cut throat competition in both rural and urban
areas

➢ Elements of culture that has an impact on marketing strategies:

• Language
• Technology and material culture:
• Communal institutions
• Education
• Values and attitudes
• Aesthetics
• Religion
• Cultural Norms
• Cultural Variability

➢ CASE STUDIES:

1.Mcdonald’s: McDonald's is the world's largest chain of hamburger fast food restaurants,
serving around 68 million customers daily in 119 countries across more than 36,000 outlets.
Founded in the United States in 1940. It entered the Indian in the year by forming two 50:50
joint ventures, one with Hardcastle Restaurants Private Ltd. in Western India and another with
Connaught Plaza Restaurants Private Ltd. in Northern India, with the first outlet opening in
Mumbai. The major challenge that McDonalds faced in India was its diversified culture. World’s
biggest beef burger company was about to set its footmark into a country which considers cow
holy. The major consumers were supposed to be vegetarians, and some non-vegetarians with
special exclusion to beef and pork. Moreover, the price points were too high for the Indian
consumers to afford. So there was a lot of homework to be done for the company on its
specialties and verities to be offered keeping in mind the price of the menu. In addition to that,
there was a fierce competition from the lots of local food retailers who had been in the market for
years and had an edge over McDonald’s in terms of prices, and knowledge of local tastes. The
most captivating challenge handling mechanism of McDonalds was its flexibility. The company
came up with the idea of localization of their product to meet the requirement and expectations
of the customers. They promised a no beef or pork menu, in addition to that, they made and
effort to come up with a variety of vegetarian menu. The company pushed itself further to
maintain separate kitchens for preparation of vegetarian and non-vegetarian meals keeping in
mind the religious and cultural sentiments. In terms of pricing as well, McDonalds came up with
the smart move of introducing 20 rupees burger called Aloo Tikki Burger. McSpicy, and special
range Cheese burgers are few other examples of localization of the menu. To cater to the price
sensitive of consumers, the Happy price menu was launched, which focused on the family fun
elements as well. Today there are as many as 350 outlets of McDonalds across India and the
company is targeting to push it beyond 1000 outlets as they foresee huge target consumers of
around 1.2 billion people.

.2.Coca-Cola:. Coca-Cola, one of the largest and oldest leading player in the Indian beverage
market with a 60 percent share in the carbonated soft drinks under the name of Coca-cola,
Thumbs up, Sprite, 36 percent share in fruit drinks labelled as Mazaa, Pulpy Orange and 33 per
cent share in the packaged water segment, Kinley. Coca-Cola Initially entered the Indian market
during the late 1970s and the Government’s order had forced the company to leave the Indian
market. The company again made an entry into the India in the year 1993 after the government
decided to liberalize the market again. This time coca cola killed all its competitors in the market
by bringing all the leading Indian soft drink brands like Thums-up, Limca, and Gold Spot using
its financial strength. Further, the controversy related to pesticide tarnished the image of the
company to and extent of bringing down the sales by 11 percent. The company worked on the
infrastructure by spending a whooping US$ 1bn for succeeding in India. The company invested
in setting-up 25 wholly owned bottling plants in India. All these steps taken by the company
ensured that the company was able to ensure a deeper level of penetration in the Indian market –
even in the rural areas. Since it re-entered the country in 1993, The company rode on two of the
strongest pillars, a brand can use in Indian advertisement and communication industry to succeed
i.e. Bollywood and Cricket. It roped in multiple film stars and cricketers so as to promote its
brand in the Indian market. Its campaign with the tag line ―Thanda matlab Coca-Cola‖ was able
to create the mass appeal for the brand in the market. The Company also successfully overcame
the biggest challenge it faced in the year 2003 of the pesticide controversy. They later came up
with airing an ad which gave a tour of the Coca-Cola factory and showcased how the 400 quality
control tests are a part of the production process in order to revive the trust of the customers that
the brand they are consuming is safe for them. Standing today, Coca-Cola India ranks among our
top 10 markets in unit-case sales. The Coca-Cola Company and its global bottling partners will
invest $5 billion in our India operations between 2012 and 2020. By the end of that period, they
are eyeing India to be one of the top five global markets.

3: Cross cultural perspective

Meaning: Cross cultural perspective is the study of psychological differences among people
living in different cultural groups. It identifies how are people’s thoughts feelings and behavior
influenced by culture . It further studies the common elements across culture.

Cross-cultural consumer analysis is defined as the effort to determine to what extent the
consumers of two or more nations are similar or different. Such analyses can provide marketers
with an understanding of the psychological, social and cultural characteristics of the foreign
consumers they wish to target, so that they can design effective marketing strategies for the
specific national markets involved.
A consumer’s level of exposure towards foreign goods or lifestyles may influence his buying
decisions and preferences. Consumers tend to have an attitude when it comes to a particular
product being made in a particular country. This attitude might be positive, negative, and neutral.
A major objective of cross-cultural consumer analysis is to determine how consumers in two or
more societies are similar and how they are different. The greater the similarity between nations,
the more feasible it is to use relatively similar strategies in each nation. If they differ in many
aspects, then a highly individualized marketing strategy is indicated.

➢ How cross-cultural consumer analysis helps a multinational marketer?

• Cross-cultural study is an extremely important activity for a multinational marketer. There are
a great many cross-cultural variations in consumer behavior that are of particular interest to
the marketer operating in more than one culture.
• As differences in verbal communication system across cultures are found such as the symbolic
communications, multinational marketers must also take that into active consideration for
success in other cultures.
• Understanding cross-cultures help marketers to understand values of other cultures which
influence their purchase behavior. This understanding helps marketers making proper
adaptations in their product, pricing, distribution, and promotion policies.
• Since marketers cannot satisfy the needs of the entire market, markets must be segmented. To
segment markets effectively, marketers also require an understanding of other cultures.
• Values also determine whether people of a particular culture will be influenced by others in
the society. Knowing this aspect of a culture helps marketers identifying reference groups that
will have bearing on consumer behavior. Thus it helps marketers to tailor their promotional
programs on specific reference group.

➢ The following examples identify basic issues that multinational marketers must consider
when planning cross-cultural consumer research

• Differences in language and meaning. Example; Words or concepts may not mean the same
in two different countries.
• Differences in market segmentation opportunities. Example; The income, social class, age
and sex of target customers may differ dramatically between two different countries.
• Differences in consumption pattern. Example; Two countries may differ substantially in
the level of use of products or services.
• Differences in the perceived benefits of products and services. Example; Two nations may
consume same product differently.
 • Differences in the criteria for evaluating of products and services. Example; The benefits
sought from a service may differ from country to country.
• Differences in economic and social conditions and family structure. Example; The style of
family decision making may vary from country to country.
• Differences in marketing research possibilities. Example; The availability of professional
consumer researchers may vary from country to country.

4. Subculture and its influence on consumer behavior.

A subculture is a group of people within a larger culture, who are categorized specifically on the
basis of their shared customs and beliefs, including religions, geographic regions, nationalities,
etc. The different sub-cultures forms several market segments whose needs can be carefully
studied by the marketer, and the strategic marketing decisions can be taken accordingly.

➢ Major Sub-Cultural Categories and Their Influences on Consumption

1. Ethnic Subculture: The ethnic subculture is based on the nationality of one’s ancestors who
have migrated to a new country. It (nationality) may form a basis for a subculture when the
members of that nationality group identify with it and base at least some of their behaviors on the
norms of the national group. Ethnic subculture is usually found in affluent countries where
people migrate from other parts of the world with the hope of a better life and live-li-hood.
Though the citizens of a particular country see themselves as citizens of that country, but they
frequently retain a sense of pride and identification in the tradition and language of their
ancestors. “When it comes to consumer behavior, this ancestral pride is manifested most strongly
in the consumption of ethnic foods, in travel to homeland, and in the purchase of numerous
cultural artifacts.

2.Religious Subculture : An individual’s religious affiliation influences to a great extent his

consumption pattern. Those who belong to a particular religion may buy/not buy and use/not use
certain goods and services. Religious beliefs and rituals may dictate the use of certain items and
may discourage the consumption of others. Muslims for example, buy and consume certain
specific food items heavily during the month of ‘Ramadan’ and buy lot of gifts during the ‘Eid.
Again, Islam discourages its followers the consumption of certain items such as alcoholic
beverages, pork etc. It is expected that members of a particular religious subculture will display
similar behavioral patterns in their purchases and consumption.

3. Regional/Geographical Subculture: The way people lead their lifestyles may also vary
according to where they live or from which part of the country they have moved to the other part
of the country. On this basis, there could be two different types of regional or geographic
subculture. One could be based on geographic region of the country and other could be based on
urban, suburban or rural distinction.
• “Different geographic regions of the country pose different problems that consumers must
solve. The most obvious of these are the climatic conditions. Climatic conditions influence
home construction, clothing requirements, and recreational opportunities to name but a few.
regional variations influence the use of particular media, the types of products used.

• Regional subcultures clearly influence many aspects of consumer behavior. The consumption
process also is influenced by the urban, suburban, and rural distinctions, another type of
regional subculture. The urban, and suburban people, for example, prefer ready or instant
food, prefer eating out, and enjoy their leisure in a way different from rural people.

4. Subculture Based on Age: Subcultures may also be based on the age differences of people
living in the same country and belonging to the same main culture. It is likely that those who
belong to the teen age group will behave quite differently than those of middle age or elderly.
Because the outlooks, experiences, attitudes and other aspects vary among people of different
age groups, their consumption patterns are likely to vary. . The youth market is a significant
subculture for the marketer. It is important to marketers not only because it is lucrative, but also
because many consumption patterns held throughout life are formed at this time.

5.Subculture Based on Gender: Difference Subculture may also be formed based on gender
difference, such as subculture of males and subculture of females. Since every society
emphasizes distinct, specific roles for men and women, they are likely to behave differently. As
their behaviors vary, they consume different types of products and respond differently to
marketing appeals. There are products which are equally used by men and women. But, different
appeals in the same product are needed for these two groups. Since characteristics, attitudes, and
needs vary between these two groups they may be considered as two different market segments.

6. Occupational Subculture : People display different patterns of purchase behaviors according

to their occupational involvement.. A defense officer, for example, will show different purchase
behavior than someone belonging to the civilians’ society. Doctors’ for example, may look at the
nutritional aspect while buying a food item. Marketers should recognize the differences in
attitudes and behaviors among people of different occupations and formulate marketing
strategies accordingly to be successful in each specific subculture.

7. Subculture Based on Social Class: Social class may also be used as a determinant of sub
cultural differences. There could be subculture of the well-offs, subculture of the middle class,
and subculture of the poverty. People belonging to the subculture of the rich will display
altogether different buying behavior than those of middle class and poors. Rich will be very
selective in their purchases; people of the middle class will have substantial control over their
consumption decisions; poors on the otherhand will be very careful and cautious in taking their
purchase decisions.
5.Social Classes in India

Social class can be defined as ‘The division of members of a society into a hierarchy of distinct
status classes, so that members of each class have relatively the same status and the members of
all other classes have either more or less status

➢ Characteristics of Social Classes

1. Persons within a given social class tend to behave more alike

2. Social class is hierarchical
3. Social class is not measured by a single variable but is measured as a weighted function of
one’s occupation, income, wealth, education, status, prestige, etc.
4. Social class is continuous rather than concrete, with individuals able to move into a higher
social class or drop into a lower class.

➢ Social Class Classification

S. Social Class Status, Value & Factors affecting Social class

No Prestige enjoyed
1 Lower Class Low Lower level occupation with no authority, less
income, and no education or minimum education,
For example, labour class or clerks etc.
2 Middle Class Medium Graduates, or postgraduates, executives’ managers
of companies with authority, drawing handsome
salary of which certain amount can be saved and
invested. For example, executives or middle level
managers of companies.
3 Higher Class High Authoritative person, drawing handsome salary,
very often professionally qualified, working in a
very senior position or a person born into a rich
family, with a good background of education.

➢ Impact of social class

• Provides a sense of identity

• Imposes a set of ‘normative’ behavior
• Classes share values, possessions, customs and activities
• Marketing response to customers of different economic means
 • Marketing to the low-income consumer
• Some marketers ambivalent as not perceived as long-term customers constitutes a
substantial group
• Target with value-oriented strategies

MODULE 4: GROUP INFLUNCE ON CONSUMER BEHAVIOUR

1. Reference Groups and its impact on consumer behaviour

A reference group is any person or group that serves as a point of comparison (or reference) for
an individual in the formation of either general or specific values, attitudes, or behavior. This
basic concept provides a valuable perspective for understanding the impact of other people on an
individual’s consumption beliefs, attitudes, and behavior. It also provides some insight into
methods that groups can be used to effect desired changes in consumer behavior

➢ Types of Reference Groups

1.Aspirational Group: These are groups in which people are not members but desires to
become one on a future date. The aspiration becomes true once they are ready to join the group
at a future point of time. The influence exerted by such group members on consumers make
them join many groups every now and then.

2.Primary and secondary groups: Primary groups are basically ones whose members are
closely knit. Family and relatives fall in this group. Secondary groups are not as closely knit as
primary groups.They may have membership in clubs where meetings happen, but such meeting
happen only once a while. The influence exerted by both primary and secondary group members
play a crucial role in decision making process pertaining to purchase of goods and services.

3.Non membership and Membership Groups: As the name suggests, Membership Groups are
the one that insist on people to become members to avail benefits offered by them. Non
membership Groups are general groups in which one associate them for keeping self updated
about certain aspects of their interests. Such group do not insist on any type of membership. The
influence exerted by membership group on consumers and their purchase decision are many a
times higher than that of non membership group.

4.Formal and Informal Groups: While formal groups re bound by set rules and regulations,
informal groups lack the same The unstructured name of informal groups tend to exert lesser
influence over consumer preference than formal groups which are highly structured. Due to its
fomal nature the influence on the group members with respect to various aspects are generally
high.
2. Consumer relevant groups:

• Friendship groups
• Family groups
• Work groups
• Virtual groups or communities
• Brand communities
• Consumer action groups
• Celebrities

3. Factors that Affect Reference Groups Influence

1. Information and Experience: An individual who has firsthand experience with a product or
service, or can easily obtain full information about it, is less likely to be influenced by the advice
or example of others. On the other hand, a person who has little or no firsthand experience with a
product or service, and does not expect to have access to objective information about, is more
likely to seek out the advice or example of others.

2. Credibility, Attractiveness, and Power of the Reference Group : A reference group, which
is perceived as credible, attractive, or powerful can induce consumer attitude and behavior
change. For example, when consumers are concerned with obtaining accurate information about
the performance or quality of a product or service, they are likely to be persuaded by those they
consider to be trustworthy and knowledgeable. When consumers are primarily concerned with
the acceptance or approval of others they like, with whom they identify, they are likely to adopt
their product, brand, or other behavioral characteristics. When consumers are primarily
concerned with the power that a person or group can exert over them, they might choose
products or services that confirm to the norms of that person or group in order to avoid ridicule
or punishment

3. Conspicuousness of the Product: The potential influence of a reference group varies

according to how visually or verbally conspicuous a product is to others. A visually conspicuous
product is one that can be seen and identified by others, and that will stand out and be noticed.
Even if a product is not visually conspicuous, it may be verbally conspicuous it may be highly
interesting or it may be easily described to others.

4 Reference Group Impact on Product and Brand Choice :In some cases, and for some
products, reference groups may influence both a person’s product category and brand (or type)
choices. Such products are called product-plus, brand-plus items. In other cases, reference groups
influence only the product category decision. Such products are called product-plus, brand-minus
items. In still other cases, reference groups influence the brand (or type) decision. These products
are called product-minus, brand-Plus items.

5. Reference Groups and Consumer Conformity :Marketers are particularly interested in the
ability of reference groups to change consumer attitudes and behavior To be capable of such
influence, a reference group must
1. Inform or make the individual aware of a specific product or brand;
2. Provide the individual with the opportunity to compare his or her own thinking with the
attitudes and behavior of the group;
3. Influence the individual to adopt attitudes and behavior that are consistent with the norms of
the group;
4. Legitimize an individual’s decision to use the same products as the group.

4; Role of family in buying decision

Definition :A family is a group of two or more persons related by blood, marriage, or adoption
who reside together. The nuclear family is the immediate group of father, mother, and child(ren)
living together. The extended family is the nuclear family, plus other relatives, such as
grandparents, uncles and aunts, cousins, and parents-in-law. The family into which one is born is
called the family of orientation, whereas the one established by marriage is the family of
procreation.

➢ Role of family in buying decision

• Initiator
• Influencer
• Decider
• Approver
• Buyer
• User
• Gatekeeper

➢ Functions of The Family

• Economic Well-Being
• Emotional Support
• Suitable Family Lifestyles
• Socialization of Children and Other Family Members
5: Family Life Cycle:

1.Young Singles :Young singles may live alone, with their nuclear families, or with friends, or
they may co-habitate with partners in this stage. Although earnings tend to be relatively low,
these consumers usually don’t have many financial obligations and don’t feel the need to save
for their futures or retirement. Many of them find themselves spending as much as they make on
cars, furnishings for first residences away from home, fashions, recreation, alcoholic beverages,
food away from home, vacations, and other products.

2. Newly Married Couples :Newly married couples without children are usually better off
financially than they were when they were single, since they often have two incomes available to
spend on one household. These families tend to spend a substantial amount of their incomes on
cars, clothing, vacations, and other leisure activities. They also have the highest purchase rate
and highest average purchases of durable good (particularly furniture and appliances) and appear
to be more susceptible to advertising.

3. Full Nest I :With the arrival of the first child, parents begin to change their roles in the family,
and decide if one parent will stay to care for the child or if they will both work and buy daycare
services. In this stage, families are likely to move into their first home; purchases furniture and
furnishings for the child; and purchase new items such as baby food, toys, sleds, and skates.
These requirements reduce families’ ability to save, and the husband and wife are often
dissatisfied with their financial position.

4. Full Nest II: In this stage, the youngest child has reached school age, the employed spouse’s
income has improved. Consequently, the family’s financial position usually improves, but the
family finds itself consuming more and in larger quantities. Consumption patterns continue to be
heavily influenced by the children, since the family tends to buy largesized packages of food and
cleaning suppliers, bicycles, music lessons, clothing, sports equipment, and a computer.

5. Full Nest III :As the family grows older and parents enter their min-40s, their financial
position usually continues to improve because the primary wage earner’s income rises, the
second wage earner is receiving a higher salary, and the children earn from occasional and part-
time employment. The family typically replaces some worn pieces of furniture, buys some
luxury appliances, and spends money on education. Families also spend more on computers in
this stage, buying additional PCs for their older children. Depending on where children go to
college and how many are seeking higher education, the financial position of the family may be
tighter than other instances.

6.Married, No Kids: Couples who marry and do not have children are likely to have more
disposable income to spend on charities, travel, and entertainment than others in their age range.
Not only do they have fewer expenses, these couples are more likely to be dual-wage earners,
making it easier for them to retire earlier if they save appropriately.

7. Older Singles: Single, age 40 or older, may be single again (ending married status because of
divorce or death of a spouse), or never married (because they prefer to live independently or
because they co-habitate with partners), either group of which may or may not have children
living in the household. This group now has more available income to spend on travel and leisure
but feels the pressure to save for the future, since there is no second income on which to rely as
they get older. .

8.Empty Nest I: At this stage, the family is most satisfied with its financial position. The
children have left home and are financially independent allowing the family to save more. In this
stage discretionary income is spent on what the couple wants rather than on what the children
need. Therefore, they spend on home improvements, luxury items, vacations, sports utility
vehicles, food away from home, travel, and product for their grand children.

9.Empty Nest II: But this time, the income earners have retired, usually resulting in a reduction
in income and disposable income. Expenditures become health oriented, centering on such items
as medical appliances and health, and medicines. But many of these families continue to be
active and in good health, allowing them to spend time traveling, exercising, and volunteering.
Many continue working part time to supplement their retirement and keep them socially
involved.

10.Solitary Survivor: Solitary survivors be either employed or not employed. If the surviving
spouse has worked outside the home in the past, he or she usually continues employment or goes
back to work to live on earned income (rather than saving) and remain socially active.
Expenditures for clothing and food usually decline in this stage, with income spent on health
care, sickness care, travel entertainment, and services.. Those who are not employed are often on
fixed incomes and may move in with friends to share housing expenses and companionship,

6. Household as a consumption unit

What is a Household? The term household is used to describe all person, both related and
unrelated, who occupy a housing unit. There are significant differences between the terms
household and family even though they are sometimes used interchangeably .The term
household is becoming a more important unit of analysis for marketers because of the rapid
growth in nontraditional families and non-family households . Among non-family households,
the great majority consist of people living alone. The remaining non-family households include
those consisting of elderly people living with non-family members.
Sociological Variables Affecting Families and Households

1.Cohesion is the emotional bonding between family members. It measures how close to each
other family members feel on an emotional level. Cohesion reflects a sense of connectedness to
or separateness from other family members.

2. Adaptability measures the ability of a family to change its power structure, role relationships,
and relationship rules in response to situational and developmental stress. The degree of
adaptability shows how well a family can meet the challenges presented by changing situations.

3.Communication is a facilitating dimension, critical to movement on the other two dimensions.

Positive communication skills (such as empathy, reflective listening, and supportive comments)
enable family members to share their changing needs as they relate to cohesion and adaptability.

MODULE 5 CONSUMER RIGHTS AND PROTECTION

1. Consumerism concept and evolution

Consumerism is the organized form of efforts from different individuals, groups, governments
and various related organizations which helps to protect the consumer from unfair practices and
to safeguard their rights.The growth of consumerism has led to many organizations improving
their services to the customer.

➢ Features of Consumerism

Highlighted here are some of the notable features of consumerism −

• Protection of Rights − Consumerism helps in building business communities and
institutions to protect their rights from unfair practices.
• Prevention of Malpractices − Consumerism prevents unfair practices within the
business community, such as hoarding, adulteration, black marketing, profiteering, etc.
• Unity among Consumers − Consumerism aims at creating knowledge and harmony
among consumers and to take group measures on issues like consumer laws, supply of
information about marketing malpractices, misleading and restrictive trade practices.
• Enforcing Consumer Rights − Consumerism aims at applying the four basic rights of
consumers which are Right to Safety, Right to be Informed, Right to Choose, and Right
to Redress.
 ➢ Need for consumer protection:

1. Physical protection of the consumer, for instance, protection against products that are unsafe
or endanger health and welfare of consumer.
2. Protection of the consumer against deceptive and unfair trade practices. Consumer must have
adequate rights and means of redress against business malpractices and frauds.
3. Ecological and environmental effects of chemical, fertiliser or refinery complexes will have to
be seriously considered because they pollute water, air and food and endanger human life.
Consumer wants due protection against all types of pollution; he wants enriched quality of life
— a beautiful, healthy, and peaceful environment free from pollution.
4. Adequate protection of consumer public against the abuse of monopoly position and/or
restrictive trade practices. Protection delayed is protection denied.

➢ Consumer Responsibilities:
(a) Critical Awareness- To be alert and questioning about the goods and services they use.
(b) Action- To act on fair and just demands.
(c) Social Responsibility- Consumers must be concerned about the impact of their consumption
behaviour on other citizens, particularly on disadvantaged groups in the local, national or
international community.
(d) Environmental Awareness- To be sensitive about what their consumption of goods does to
the environment and not waste scarce natural resources or pollute the earth.
(e) Solidarity- To act together through the formulation of consumer groups which have the
strength and influence to promote consumer interests.

2. Consumer Rights under the Consumer Protection Act, India

1. Right to Safety: According to this right the consumers have the right to be protected against
the marketing of goods and services which are hazardous to life and property, this right is
important for safe and secure life. This right includes concern for consumer’s long term interest
as well as for their present requirement.Sometimes the manufacturing defects in pressure
cookers, gas cylinders and other electrical appliances may cause loss to life, health and property
of customers. This right to safety protects the consumer from sale of such hazardous goods or
services.

2. Right to Information:According to this right the consumer has the right to get information
about the quality, quantity, purity, standard and price of goods or service so as to protect himself
against the abusive and unfair practices. The producer must supply all the relevant
3. Right to Choice: According to this right every consumer has the right to choose the goods or
services of his or her likings. The right to choose means an assurance of availability, ability and
access to a variety of products and services at competitive price and competitive price means just
or fair price.The producer or supplier or retailer should not force the customer to buy a particular
brand only. Consumer should be free to choose the most suitable product from his point of view

4. Right to be Heard or Right to Representation:According to this right the consumer has the
right to represent him or to be heard or right to advocate his interest. In case a consumer has been
exploited or has any complaint against the product or service then he has the right to be heard
and be assured that his/her interest would receive due consideration.This right includes the right
to representation in the government and in other policy making bodies.

5. Right to Seek Redressal: According to this right the consumer has the right to get
compensation or seek redressal against unfair trade practices or any other exploitation. This right
assures justice to consumer against exploitation.The right to redressal includes compensation in
the form of money or replacement of goods or repair of defect in the goods as per the satisfaction
of consumer. Various redressal forums are set up by the government at national level and state
level.

6. Right to Consumer Education: According to this right it is the right of consumer to acquire
the knowledge and skills to be informed to customers. It is easier for literate consumers to know
their rights and take actions but this right assures that illiterate consumer can seek information
about the existing acts and agencies are set up for their protection.The government of India has
included consumer education in the school curriculum and in various university courses

3: Laws protecting consumers

1.The essential commodities act 1950: This act makes the government to maintain fair price,
production, distribution, supply etc. The central government has delegated with some of these
powers to the state government. Many commodities have been retained for the protection of the
consumer. Due to the unfair distribution supply and price of the commodities this act has been
implemented to eradicate such unfair practice

2.The food safety and standard act 2006: This act regulates the food storage, manufacturing
food items, distribution of food, for the safeguard of the consumers. So that the consumer get a
healthy consumption of foods. Many scientific panels have approved and finally this act came
into regulation
3.The contract act 1872: The consumers enter into contract in each case of buying a product. In
case of breach of such contract this act provides remedies for the consumer. The sale of goods
act: This act provides the consumer from goods which are not complied with said condition and
warranty. It gives relief to the condition and warranty. It gives relief to the consumer in case of
violation

4.The drug and cosmetics act 1940: This act regulates distribution of drugs in India. It mainly
concentrates that the drug and cosmetics which are in circulation are safe, effective and it is of
high quality. If a manufacturer does not manufacture as per the quality will be suspended from
manufacturing of such drugs. The drugs and cosmetics act also deals with fake and alternative
drug